Week Ending August 20, 2010

State tax revenue figures from the first month and a half of the fiscal
year were announced this week, and Massachusetts collected 6.9% more
over the comparable period from FY2010. Through July and the first half
of August, the Department of Revenue collected $611 million, an increase
of $24 million from 2009. The higher revenue figures can be attributed
in part to a $42 million increase in month-to-date withholding tax
collections. Revenue Commissioner Navjeet Bal also made clear that the
July and August numbers do not include the potential increase in
economic activity, along with decrease in tax revenue, attributed to the
sales tax holiday that took place last weekend.

The first gubernatorial issues debate, organized by MassINC was held at
Suffolk University on Monday. The four candidates participating in the
debate were Republican Charles Baker, Treasurer and Independent Tim
Cahill, Democratic Governor Deval Patrick and Dr. Jill Stein of the
Green-Rainbow party. Billed as an in-depth single issue debate on Cape
Wind, the candidates were asked to give a two minute summary of where
they stand on Cape Wind. Of the four candidates, only Governor Patrick
was in support of the Cape Wind project. Patrick said he was in favor of
Cape Wind, and strongly so because it represented an emissions free,
reliable, locally generated renewable energy source. Charlie Baker made
clear his opposition to Cape Wind because of the already high
electricity costs borne by ratepayers. Cahill said Cape Wind was the
wrong approach because out of state companies will receive the vast
majority of Massachusetts tax subsidies. Cahill also made clear his
support for on-shore wind development, saying that on-shore wind is much
more efficient use of resources. In their closing statements, Charles
Baker said that Cape Wind will raise utility rates, Tim Cahill called
Cape Wind the “wrong project at the wrong time” and Patrick pointed to
the reliability of a long term power contract with Cape Wind and its
effect on stabilizing energy prices. The Governor’s tentative support of
nuclear power also made headlines following the debate.

Massachusetts employers added more jobs in July than in any month over
the past two decades. According to the Office of Labor and Workforce
Development, employers in the state added 13,200 jobs in July. This
total reflects the 19,200 jobs that were added in the private sector,
minus the 6,000 government jobs lost last month. The government job
losses resulted from the temporary Census positions, which had driven up
the number of state jobs earlier this year. Governor Patrick was quick
to claim success from Massachusetts’s investment in biotech, clean
energy and film production. His opponents, Republican Charles Baker and
Independent Tim Cahill, noted the significant job losses since Patrick
took office and the overall number of lost jobs in the past year.
Despite these gains, the unemployment level in Massachusetts for July
remained at 9%, unchanged from last month.

Legislative action remained light this week as the Legislature continued
holding informal sessions with few attendees who act on
non-controversial legislation.

John Nunnari